The ACIT, Central Circle-1(3), Ahmedabad V. Shri Hasmukhbhai N. Vora, Ahmedabad

ITSSA 4/AHD/2012

• Counselvise Citation: [2015] 122 COUNSELVISE.COM (IT) 0748 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 5 month(s) 24 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 03-07-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 01-07-2015
• Assessment Year: 2002-2003
• Appeal Filed On: 09-01-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NARENDRA SINGH
• Assessee Lawyers: P M MEHTA
• Keywords: Depreciation; Opportunity of being heard
• Section: 143(3); 153A; 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, AHMEDABAD (BEFORE SHRI SHAILENDRA KR. YADAV, J.M & SHRI ANIL CHATURVEDI, A.M.) I.T.(SS) A. NO. 04/AHD/2012 & C .O. NO. 65/AHD/2012 (ASSESSMENT YEAR: 2002-03) A.C.I.T., CENTRAL CIRCLE 1(3), AHMEDABAD V/S SHRI HASMUKH N. VORA 302, ANAND CHAMBERS, NOR. OLD HIGH COURT, NAVRANGPURA, AHMEDABAD-380009 (APPELLANT) (RESPONDENT) SHRI HASMUKH N. VORA 302, ANAND CHAMBERS, NOR. OLD HIGH COURT, NAVRANGPURA, AHMEDABAD-380009 V/S A.C.I.T., CENTRAL CIRCLE 1(3), AHMEDABAD (APPELLANT) (RESPONDENT) PAN: ACFPV5649F APPELLANT BY : SHRI NARENDRA SINGH , SR. D.R. RESPONDENT BY : SHRI P.M. MEHTA, A.R. ( )/ ORDER DATE OF HEARING : 01-07-2015 DATE OF PRONOUNCEMENT : 03 -07-2015 PER ANIL CHATURVEDI, ACCOUNTANT MEMBER. 1. THIS APPEAL FILED BY THE REVENUE IS AGAINST THE ORD ER OF CIT(A)-III, AHMEDABAD DATED 24.10.2011 FOR A.Y. 2002-03 AND ASS ESSEE HAS ALSO FILED C.O. 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON RECORD ARE AS UNDER. IT(SS)A NO 4/AHD/1 2 & C.O NO.65/A/2012 . A.Y. 2002-03 2 3. ASSESSEE IS AN INDIVIDUAL STATED TO BE DEALING IN S HARES AND SECURITIES. ASSESSEE FILED HIS RETURN OF INCOME FOR A.Y. 2002-0 3 ON 19.02.2007 DECLARING TOTAL INCOME OF RS. 2,96,400/-. THE CASE WAS SELECTED FOR SCRUTINY AND THEREAFTER THE ASSESSMENT WAS FRAMED UNDER SECT ION 143(3) R.W.S. 153A ON 31.12.2007 AND THE TOTAL INCOME WAS DETERMINED A T RS. 76,72,452/-. SUBSEQUENTLY AN ORDER U/S. 154 OF THE ACT WAS PASSE D BY THE A.O ON 26.02.2010 WHEREBY THE CARRY FORWARD AND SET OFF OF LOSS OF 78,46,104/- FOR A.Y. 2001-02 WAS NOT ALLOWED TO BE SET OFF AGAINST THE INCOME FOR THE REASON THAT THE ASSESSEE HAD FILED RETURN OF INCOME FOR A. Y. 2001-02 BELATEDLY. AGGRIEVED BY THE ORDER PASSED U/S. 154 DATED 26.02. 2010, ASSESSEE CARRIED THE MATTER BEFORE LD. CIT(A) WHO VIDE ORDER DATED 2 4.10.2011 ALLOWED THE APPEAL OF THE ASSESSEE BY HOLDING AS UNDER:- 4. I HAVE CONSIDERED THE SUBMISSIONS OF THE APPELLA NT. THE BASIC REASON GIVEN BY THE AO FOR DENYING THE CARRY FORWARD AND SET OFF OF LOSS O F RS.78,46,104/-PERTAINING TO A.Y. 2001-02 IS THAT THE RETURN OF INCOME FOR A.Y. 2001- 02 IS BELATED. IT MAY BE MENTIONED THAT THE RETURN OF INCOME FOR A.Y. 2001-02 WAS FILED BY THE APPELLANT ON 31/10/2001. SINCE THE APPELLANT WAS SUBJECTED TO TAX AUDIT, THE DUE DATE FOR FILING THE RETURN WAS 31/10/2001. THEREFORE, THE OBSERVATION OF THE AO THAT THE RETUR N OF INCOME FOR A.Y. 2001-02 WAS BELATED, IS NOT CORRECT. IN THE RETURN FILED ON 31/ 10/2001 THE APPELLANT HAS CLAIMED BUSINESS LOSS OF RS.77,89,270/- AND DEPRECIATION OF RS.56,834/- TOLLING RS.78,46,104/-. SINCE THE RETURN OF INCOME HAS BEEN FILED BY THE AP PELLANT ON 31/10/2001 AND THE DUE DATE FOR FILING THE RETURN FOR A.Y. 2001-02 IN THE CASE OF TAX AUDIT WAS 3/10/2001, THE AO'S CONTENTION THAT THE RETURN WAS BELATED IS FACTUALLY INCORRECT. THEREFORE, HE IS DIRECTED TO ALLOW THE CARRY FORWARD AND SET OFF OF LOSS OF RS.7 8,46,104/- OF A.Y. 2001-02 AGAINST THE TOTAL INCOME OF ASSESSMENT YEAR 2002-03. IN SHORT, THE APPEAL OF THE APPELLANT IS ALLOWED. 4. AGGRIEVED BY THE AFORESAID ORDER OF LD. CIT(A), REV ENUE IS NOW IN APPEAL BEFORE US AND RAISED THE FOLLOWING GROUNDS:- IT(SS)A NO 4/AHD/1 2 & C.O NO.65/A/2012 . A.Y. 2002-03 3 1. THE LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN DIRE CTING THE ASSESSING OFFICER TO ALLOW THE CARRY FORWARD AND SET OFF OF LOSS OF RS.7 8,46,104/- OF A.Y.2001-02 AGAINST THE TOTAL INCOME OF A.Y.2002-03. 2. THE LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN IGNO RING THAT THE LOSS HAVING BEEN DETERMINED IN PROCEEDINGS INITIATED U/S.L53A OF INC OME TAX ACT, THE LIMITATION DATE FOR CARRY FORWARD IS THE DATE OF FILING OF THE RETU RN U/S. L53A OF THE ACT AND NOT THE RETURN OF INCOME FILED U/S. 139(1) OF THE ACT EARLI ER. 5. ASSESSEE HAS ALSO FILED C.O AND THE GROUNDS RAISED IN THE C.O READS AS UNDER:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT(A) SHOULD HAVE ALSO REALIZED AND HELD THAT IN THE IMPUGNED ORDER U/S.15 4 DATED 26.2.2010 THE ACTION OF DISALLOWING BENEFIT OF BROUGHT FORWARD BUSINESS LOS S OF THE PRECEDING YEAR WAS NOT VALID IN LAW, INTER ALA, FOR EACH OF THE FOLLOWING REASONS : (I).THE POINT OF DISALLOWANCE OF BENEFIT OF BROUGHT FORWARD LOSS DID NOT INVOLVE ANY MISTAKE APPARENT FROM RECORD. (II).THAT ADVERSE DECISION WAS TAKEN WITHOUT GIVING ANY SHOW CAUSE NOTICE TO THE ASSESSEE. (III).THAT ADVERSE DECISION WAS NOT ARISING FROM TH E ASSESSEE'S ANY REQUESTS U/S.154 AND AT ANY RATE NO OPPORTUNITY OF BEING HEARD WAS G IVEN TO THE ASSESSEE 6. BEFORE US, LD. A.R. REITERATED THE SUBMISSIONS MADE BEFORE A.O AND LD. CIT(A) AND SUPPORTED THE ORDER OF LD. CIT(A). WITH RESPECT TO C.O, LD. A.R. SUBMITTED THAT HE DID NOT WISH TO PRESS THE GROUNDS RAISED IN C.O. LD. D.R. ON THE OTHER HAND SUPPORTED THE ORDER OF A.O. 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. WE FIND THAT LD. CIT(A) WHILE ALLOWING THE APPEAL OF T HE ASSESSEE HAS NOTED THAT THE RETURN OF INCOME FOR A.Y. 2001-02 WAS FILED BY THE ASSESSEE ON IT(SS)A NO 4/AHD/1 2 & C.O NO.65/A/2012 . A.Y. 2002-03 4 31.10.2001 AND SINCE THE ASSESSEE WAS SUBJECTED TO TAX AUDIT, THE DUE DATE FOR FILING OF RETURN WAS 31.10.2001 AND THEREFORE T HE OBSERVATION OF THE A.O THAT THE RETURN OF INCOME FILED FOR A.Y. 2001-02 WA S BELATED WAS NOT CORRECT. THE ASSESSEE HAS ALSO PLACED AT PAGE 34 OF THE PAPE R BOOK, THE COPY OF THE ACKNOWLEDGEMENT OF THE FILING OF RETURN WHICH BEARS THE DATE OF 31 ST OCTOBER, 2001. BEFORE US, REVENUE HAS NOT BROUGHT A NY MATERIAL ON RECORD TO CONTROVERT THE FINDINGS OF LD. CIT(A). IN VIEW OF T HE AFORESAID FACTS, WE FIND NO REASON TO INTERFERE WITH THE ORDER OF LD. CIT(A) AND THUS THE GROUND OF REVENUE ARE DISMISSED. FURTHER SINCE THE LD. A.R. D ID NOT PRESS FOR THE C.O, THE C.O OF THE ASSESSEE IS ALSO DISMISSED AS NOT PR ESSED. 8. IN THE RESULT, THE APPEAL OF REVENUE AND C.O OF ASS ESSEE ARE DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 03- 07 - 2015. SD/- SD/- (SHAILENDRA KR. YADAV) ( ANIL CHATURVEDI) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD. TRUE COPY RAJESH COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHME DABAD